Wednesday, June 24, 2009

Revenue bosses asked to collaborate

Mr. Oupa Magashula, acting Commissioner of South African Revenue Service has advised tax commissioners in the various African countries to form alliances to brainstorm on the possible modalities to combat the devastating global financial meltdown and its negative impact on the continent.

“Africa should be able to dialogue, interact and share ideas to find solution to the problems of the effect of the global financial crisis on Africa,” he said.

Mr. Magashula who made these known to B&FT in Accra explained that the current financial crisis is devastating and if the various countries do not co-operate, the consequences will be most devastating.

"If we don't co-operate to solve the situation on hand, the poverty threat in the continent will worsen and we will all go down in the economic slum," he said.

He observed that the developed countries are looking out for ways to shift the huge losses recorded in their balance sheets to African countries.

Briefing the media on the meeting of the steering committee of African Tax Commissioners Forum (ATAF) from seven African countries including Ghana, Botswana, Nigeria, Rwanda, South Africa, Uganda and representative from Cameroon, Mr. Magashula explained that the objective of the forum was to discuss the final draft constitution prior to its inauguration by the end of the year.

The meeting also afforded participant the opportunity to take stock of the progress toward the successful establishment of the ATAF.

Major (Rtd) Daniel Ablorh-Quarcoo, Commissioner, Internal Revenue Service (IRS) indicated that the creation of the Forum is to strengthen tax administration in Africa and also to create platform to share experiences, encourage and support new partnerships as well as promote co-operation.

“The forum as part of its mandated is to formulate new direction for tax policy administration which will reflect African needs and strategies.

It will as well to assist African governments meet their monetary commitment for national development and thereby reduce dependency on donors,” he emphasised.

UBA to invest in agric sector

The United Bank for Africa (UBA) Ghana says it will channel enough of its funds to support local farmers to enhance national food security.

The Chief Executive Officer of the Bank, Edgal Gabriel who made these known at the opening of a six-day entrepreneurial training workshop in Accra, explained that agriculture and the development of Small and Medium Scale Enterprises (SMEs) are critical to the growth of African economies and that UBA is at the forefront to support initiatives in these areas.

“Our huge investment in these sectors is driven by our mission to be a model for African business and by our philosophy to do well and do good,” he said.

The workshop which is under the theme: ‘Growing Businesses’ is being organised in collaboration with EMPRETEC Ghana Foundation and United Nations Conference on Trade and Development (UNCTAD) and is aimed at identifying SME businesses and providing them with tools and entrepreneurial skills to enable them develop their businesses, generate employment and create wealth for Africans.

“The workshop for SMEs is most appropriate at this time when the government has committed to push for economic empowerment generation, poverty alleviation and food security,” Mr. Gabriel said.

Ghana’s agriculture sector provides livelihood for more than 60 percent of the estimated 22 million population and create jobs for over 40 percent of the people in the job market.

Concerns have been raised about government’s limited contribution toward the development of the sector. Agricultural Producers have little access to financial resources and modern technologies which have become a major inhibiting factor affecting the growth of the sector.

Statistics have shown that a sizable percentage of all business in Africa fall under the SME category and contribute approximately 40 percent of Gross Domestic Products (GDP) of most African countries.

However, research indicates that in Africa, gaps in terms of business and organisational skills, business enhancing behavior, attitude and lack of access to finance are some of the major factors hampering the growth of the SME sector.

Deputy Minister of Trade and Industry, Mr. John Gyetuah indicated that the country’s SME sector plays pivotal roles in creating dynamic, market-oriented economic growth.

The sector also employs the growing work force, alleviating poverty, increasing the tax revenue base and promoting socio-economic stability.

He therefore called for an effective public private partnership to find possible ways of addressing the problems faced by SMEs in the country.

Lack of standard hits hospitality industry

African Management Services Company (AMSCO) has observed that the country’s hospitality industry lack quality standards and that capacity development is almost non-existent in many cases.

“The industry is in dire need of capacity development, with just under 15 percent of its workforce being trained countrywide.”

Regional Training Coordinator, AMSCO, Theodora Acquah made these known to B&FT after the opening of a three day training programme for 26 senior hotel managers from Ghana and Nigeria

The training programme organised in partnership with the International Finance Corporation (IFC), the United Nations Development Programme (UNDP) and the Ghana Tourist Board on food security in the hospitality sector was aimed at developing the capacity and enhancing service delivery in the industry.

Mrs. Acquah said: “The training will improve the business performances of hotels and also prepare them to meet the challenge of offering enhanced services during the upcoming World Tourism Day which will be hosted by Ghana later this year.

This represents a positive contribution by AMSCO, to Ghana’s efforts at meeting two of the millennium development goals namely eradicating poverty and developing a global partnership for development”

Food safety management system is the cornerstone of food safety. Communication along the food chain is essential to ensure that all relevant food safety hazards are identifies and adequately controlled at each step with in the food chain, she remarked.

Marieme Travaly, Portfolio Unit Head for West and Central Africa, IFC indicated that Ghana has recorganised the significant contribution the tourism sector can make towards its economic growth.

The linkages with the local economy can be strong, ranging from construction materials, local art and handicrafts, textiles, food and beverage supplies, visits to cultural sites and transportation.

The increasing challenges the hotel sector is facing globally and the escalating demand for tourism products and services especially in the emerging markets, there is an urgent need for players in the region to offer high quality performance standards to survive, she observed.

Thursday, June 18, 2009

Cable manufacturers call for gov’t’s support

Manufacturers of cable and the conductors have urged government as a matter of urgency to provide financial support to grow the local industry.

Operators of the sector contended that accessing financial assistance from the financial institutions is very expensive and that affects the cost of production which also reflects in their cost of products.

Mrs. Kate Quartey-Papafio, Chief Executive Officer of Reroy Cable and Conductor briefing the media said “cable and conductors industry need to develop new technologies and products to serve the local market but the sector requires government assistance and that can be done when cost of credit is low.”

She urged government to support the industry through the provision of incentives to position the sector which will create jobs and train more skilled labour to grow the economy.

“We need incentives from government such as tax rebate so as to train more young graduates.”

She called on government to impress upon banks to reduce their lending and interest rates to promote favourable business environment.

“Government should make real its promise to invest in Ghanaians by concentrating on the indigenous manufacturers especially the cable industry to grow the cable industry which will result in opening more opportunities for Ghanaian businesses.

Mrs. Quartey-Papafio advised that government can institute a policy of ensuring that the local contractors patronise local products in the execution of contracts in the country.

She indicated that Reroy Cables Limited is considering developing new products as well as coming out with some programmes to educate the building and electrical contractors on the use of locally manufacture electrical cables.

Reroy Cables Limited started operating in the Heavy Industrial Area, Tema in the 90’s. The company produces predominantly for the international export market and has significant domestic market presence as well.

The company recently completed the construction of a new manufacturing plant, making it one of the largest electrical cables manufacturing plant in Ghana when it attained full capacity utilization in March 2007.

Tuesday, June 16, 2009

Aviation workshop underway

Deputy Minister for Transportation, Mrs. Dzifa Attivor on Monday opened a seminar on International Air Law in Accra, with a call on aviation practitioners to develop their human capital to conform to the global aviation practices and conventions.

The four-day seminar organised by Felvic Aviation Event, a subsidiary of Kilo Aviation Holdings Limited, is in collaboration with the International Air Travel Association (IATA) to equip stakeholders and professionals in the aviation industry with its associated dynamics.

The seminar will discuss topics such as internal conversion for accident compensation for victims, economic regulations of the aviation industry, the legal regime of safety and security as well as ability to carve a niche in the fast-growing aviation industry.

Mrs. Attivor said: The training programme constitutes a significant contributory factor to the fast moving aviation industry, for purposes of safety and security in air operations.

The safety and efficiency of international civil aviation depends primarily on the skills of the personnel that manage, operate and maintain its systems, she remarked.

“These aviation personnel, both on the ground and in the air, must of necessity possess high individual skills; but in order for an international system to function safely and totally, they must be able to work together as an international team.

“The challenge of human resource confronting the aviation industry worldwide and particularly in Africa is of prime concern.

“This comes with its attendant cost of staff resignations in the industry to other well-endowed aviation industries outside of Africa. It is therefore important to train more people to address the brain-drain,” she emphasised.

Michael Gill, Senior Legal Council of IATA, explained that training aviation stakeholders in the country and the sub-region is paramount to meeting the objectives and standards of the international aviation industry.

“Issues that have to do with training must be taken seriously to ensure safety in the industry,” he stressed.

Non-bank institutions get gov’t backing

Government is adopting specific strategies and policies to encourage the non-banking financial institutions in the country to improve payment systems.

The strategies and policies will include capacity building and promoting the formal and informal financial sectors to increase networking.

Currently there are 133 rural banks operating in the country with 45 licenced non-bank financial institutions ranging from leasing, savings and loans companies, money transfer institutions and mortgage finance companies.

Dominic Donkor, Director of Financial Sector at the Ministry of Finance, said: “Non-banking financial institutions are indispensable tools in the drive for Ghana’s sustainable economic development.

He indicated that the cost of doing business in Ghana is relatively high and poses a direct risk to new businesses, mainly due to the high cost of borrowing from financial institutions.

“The low level of Ghana’s overall financial intermediation compared to other sub-Saharan African countries further constrains financial and private sector growth,” he said.

Mr. Donkor was making a presentation at the rebranding of Bayport Financial Services-Ghana (BFSG) in Accra.

Mr. Kofi Adu-Mensah, Managing of Director of Bayport Financial Service, explained that as part of the company’s corporate social responsibility programme, it is in collaboration with the Ghana National Association of Teachers to support the education of brilliant but needy children.

The scholarship is in its second year of operation, supporting 10 children from Senior High School level through to Tertiary level, with the cost of each scholarship per child for eight years estimated at GH¢11,000.

The company since its inception in 2003 has 25 branches in the country providing over 112,000 clients, of which 74,000 are still active and have been contributing to the Otumfuo Educational Fund and Okyeman Environmental Fund.

The company offers loans to its varied clients, which include public and civil servants as well as private sector employees. Bayport Financial Services-Ghana is part of a parent-group with its head office in Mauritius and subsidiaries in South Africa, Zambia, Tanzania and Uganda.

Monday, June 15, 2009

May inflation falls to 20.06 %

Headline inflation rate fell to 20.06 percent in May, down from 20.56 percent in April- the first drop in nine months, but still a five year high.

Falling prices of food items-namely milk, cheese and eggs as well as communication contributed largely to the current decline in the Consumer Price Index (CPI).

Professor Nicholas Nsowah-Nuamah, Deputy Government Statistician, briefing the media in Accra said: “The rate of inflation fell in May for the first time in 2009 since the rate started going up in October last year.

“Record high prices for oil and rising food prices pushed retail prices up last year sending inflation on an upward spiral.

“The trend observed in the first four months of 2009 is similar to that of the same period in 2008.

However, the slight decline in the rate in May 2009 is a deviation from the sharp rise observed in May 2008.”

Under normal circumstance the fall marks the beginning of the decline but last two-week’s Saturday hike of 30 percent in fuel prices leading to a 17 percent rise in transport fares which normally have direct effect on consumer spending makes the outlook for the coming months unclear.

This development makes the inflationary trend outlook unclear.

“We are unable to pronounce any prediction now because of the recent fuel price hikes, which normally have direct effect on consumer spending,' he said.

The non-food group, which constitutes 55.09 percent of the CPI, continues to exert its driving force on inflation.

In May 2009 the rate of inflation for non-food group was 22.2 percent as against 17.17 percent for the food groups. The corresponding figures for April 2009 were 21.46 and 19.32 percent for non-food and food respectively.

The country’s headline inflation rate has been on the upward trend since October 2007, confirming fears of government not meeting its macro-economic targets this year. Government has targeted an end-end-of –year inflation rate of 12.5 percent.

UN confirms more crude oil reserves in the eastern corridors

More than eight billion barrels of crude reserves exist in the ultra-deep waters of the Ghana's eastern corridor, the United Nations International Seabed Authority (UNISA) has confirmed.

Ghana is, therefore, seeking the expansion of her continental shelf to help redeem that natural resource.Mr. Solomon Korbieh, Foreign Service Officer at the Ministry of Foreign Affairs explained that Ghana had already made a submission to the United Nations (UN) Commission on the limits of the Continental Shelf (CLCS) for the expansion of the continental shelf, which has a lot of prospects for more oil discovery.

The submission, which was made to the CLCS on April 28, 2009, in accordance with Article 76, paragraph 8 of the UN Convention on the Law of the Sea, seeks to expand Ghana's exclusive economic zone from the current 200 nautical miles to 350 nautical mils, thus widening the scope of the country's oil potential.

Available information revealed that in the absence of any objections, consideration of Ghana's submission is likely to be included in the agenda of the 24th session of the commission scheduled to be held in New York from August 10, 2009 to September 11, 2009.Mr Korbieh, who confirmed the submission, said it was very certain that Ghana's request would be approved by the UN commission.

Under laid-down procedure, proposals submitted will be published On the website of the Division for Ocean Affairs and the Law of the Sea to entertain criticisms and objections, after which a subcommittee will be set up by the commission to sit on the merits of individual proposals.

Ghana is among 50 countries worldwide, including Nigeria, Cote d'Ivoire and Kenya, who beat the May 13, 2009 deadline for UN member countries to seek expansion of their territorial waters.

Experts say the oceanographic work required to research and fine-tune submissions for extension is very costly.

Mr Lawrence Apaalse,the National Co-ordinator of the Ghana National Continental Shelf Delineation Project,said $8 million was budgeted for the preparation of the document.

He said if no objection was raised against the submission, the next step was for Ghana to make a presentation of the technical details to the commission for consideration.

Mr Apaalse, who is also a Lead Geologist at the Ghana National Petroleum Company (GNPC), said but for issues of overlapping boundaries that might arise from submissions made by neighbouring countries, the success of Ghana's submission was not in doubt.

Wednesday, June 10, 2009

Gov't plans to review petroleum exploration and production law

Government says there would be periodic review and revise of the Petroleum Exploration and Production Law and the Petroleum Income Tax Law to maintain an attractive investment environment for oil and gas companies.

Dr Joe Oteng-Adjei, Minister for Energy, who made this statement emphasised that the review of policies on oil and gas sector will ensure effective management, guarantee sustainability and protect the environment.

He said "We have to re-organise the institutions to make them more effective and relevant to the sector.

Efforts should be made to fashion out an effective framework for the development and management of the oil and gas sector".

Dr Oteng-Adjei made the call when delivering the keynote address at the opening session of the on-going three-day Oil and Gas Business Conference and Exhibition organised by the management of West Africa Business Association (WABA), Ghana.

The conference under the theme "Oil and Gas; Ghana Asem Pa" is to create awareness on the need for policies and strategies to make the oil find a blessing to the country.

It also sought to promote the oil discovery for businesses to reposition themselves and strategise to ensure communities and operators holistically benefit from the oil.

"We also need to create a friendly environment to encourage investments in the oil and gas industry value chain through fiscal incentives and even handed regulations," he added.

Dr Oteng-Adjei noted that to maintain the country's oil and gas asset, Ghana would work with external partners to ensure smooth development of the sector.

He said there was also the need for a national oil and gas security and regulatory framework adding, the national security and the army would be supported to provide security for the industry.

Dr Oteng-Adjei called on local authorities to develop their expertise and capacity to ensure increased local involvement. "We pledge the commitment of Government to ensure transparent development of oil and gas resources as an integral part of developing the country's economy," he said.

Mr Joseph Winful, Chairman of WABA (Ghana) called on all stakeholders in the sector to forge closer partnership to promote development of the sector.